UK property presents great opportunities for fixed-income investors in 2025

While the UK property market is expected to remain stable, the real opportunity lies in platforms like Folk2Folk that offer access to predictable income through property-secured lending.

“The UK economy is not in very good shape at the moment,” says Roy Warren, managing director of Folk2Folk.

“The equity market is volatile, but the demand factor of property in the UK means that there is more stability in property investing.“Valuers are being very cautious at the moment, and we are seeing property valuations being reduced slightly, but we don’t foresee any significant decreases in the year ahead.

”Folk2Folk allows investors to tap into the inherent value of property without exposing them to the complications of property ownership or the volatility of real estate equity investing, while still gaining the benefits of property-backed stability for their capital investment and a fixed monthly income.

With a minimum investment of £20,000, the platform’s investors can earn fixed returns starting at 8.75 per cent per annum, with no fees to invest.

All of Folk2Folk’s loans are secured against UK property with a conservative loan-to-value (LTV) ratio of approximately 60 per cent of open market value, ensuring a comfortable level of security.

Investors earn predictable monthly interest payments, providing a fixed-income solution for those prioritising consistent monthly returns. Additionally, Folk2Folk focuses on regional UK businesses, adding the benefit of supporting local and regional economies while earning competitive returns.

“Property-backed lending allows investors to benefit from the value of property without the burdens of ownership, such as maintenance, new tax legislation, or tenant management,” explains Warren.

“It also offers enhanced liquidity compared to physical property, especially through platforms like Folk2Folk, where loans are structured for a fixed term, with defined interest payments.

”As with any investment, property loans carry risks such as borrower defaults or changes in property value. However, these risks are mitigated via intensive due diligence and by securing loans against property assets, with relatively low LTVs. In Folk2Folk’s case, the 60 per cent LTV means that UK properties would have to decline in value by more than 40 per cent before the security no longer provides protection.

Folk2Folk manages the risk of borrower defaults by taking a hands-on approach towards due diligence, with all decisions made by experienced professionals rather than automated systems. This includes assessing the borrower’s financial position, business viability, and appointing external valuers who carry out the property valuations.

Warren is passionate about delivering great fixed returns to his investors, and offering an alternative to the volatility of equities and the challenges of property ownership.

He notes that the weaker UK economy has led to rising interest rates and persistent inflation concerns, which have made traditional fixed-income products less attractive, as their real returns erode.

“In contrast, property-backed investments with fixed income provide a hedge against these challenges, offering above-average returns while benefiting from the security of underlying property assets,” says Warren.

Property-backed fixed income combines the best of both worlds: a tangible asset that holds intrinsic value; and a steady stream of income. In 2025, as investors look for stability amid economic shifts, these investments present an opportunity to pursue consistent returns without the complexities of direct property ownership.

This combination of tangible security and monthly income provides an attractive option for those prioritising financial stability during uncertain times.